Should You Trust Your CEO With Cloud Computing Decisions?

Could the long-awaited tech "singularity" finally be upon us? That is, business leaders understand technology requirements, and technology executives are helping to lead the business?

Traditionally, chief executive officers have come up through the ranks from the finance, sales or marketing side, so they don't necessary bring an in-depth understanding of technology deployments. Not that it was necessary -- the IT department ran its systems and spit out reports, while everyone else stuck to their specialties.

Now, everybody is getting into the technology act. A new study published by Deloitte finds that business executives -- CEOs and CFOs -- are getting directly involved in technology decisions. Maybe not studying and selecting application servers or hypervisors, but determining the technology direction that needs to be taken -- whether it be moving to cloud, or deploying mobile to get closer to customers.

Close to two-thirds (62 percent) of 500 mid-market executives say their company’s C-suite leaders have “some” level of involvement in the adoption of next generation technologies such as cloud, social, analytics and mobile. In fact, nearly half (46 percent) say C-suite is “actively engaged.” A growing percentage (33 percent, compared with 20 percent in 2014) say their leadership is even “leading the charge.”

In fact, when asked who leads the adoption of new and emerging technologies, there's almost an even split between business executives and IT executives. Twenty-six percent say business leaders are in charge, 36 percent say IT leaders are in charge, and 37 percent say it's a combination of both business and IT leaders.

What are executives focusing on the most? Cloud and analytics are the major areas of consideration, the survey's authors point out. Among the new technologies, analytics (47 percent) and cloud applications (43 percent) are seen as having the highest potential to produce the greatest productivity gains. Many mid-market companies are speeding up their adoption of these technologies. Analytics is now pervasive -- 80 percent of executives say they use business analytics, compared to 65 percent who said the same last year. Cloud follows at 42 percent -- up from 34 percent last year.

Is it a good thing to have business leaders getting intimately involved with technology decisions? There are two ways to look at it. First, here are three reasons to be concerned:

Misdirection from the top: One risk, of course, is that many IT systems and platforms may run into the millions of dollars, and buying the wrong types of systems could end up as huge paperweights over the heads of employees trying to get stuff done or be more innovative.

Technocracy from the top: Having business leaders looking at tech and analytics as the answer to every single business problem runs the risk of an organization being run by technocrats, versus visionaries. There's a need for creative "liberal-arts" thinking to help provide vision and innovation in ways no one would expect -- especially competitors.

Corporate cultural issues: Related to technocratic thinking is the tendency for executives to buy into vendors' claims of nirvana for buying into solutions. There have been countless instances over the decades of business leaders thinking they can simply shell out the money and drop a solution onto their organization, expecting a magical overnight transition as a result. Instead, it takes visionary management to move an organization forward, with technology following to help make that vision happen. As the noted consultant Dr. Michael Hammer once put it so well: "Automating a mess, yields an automated mess."

But there are a lot of positive aspects to business executives getting IT religion, and here are three reasons why this needs to be encouraged:

Business needs to lead the technology direction. In today's environment, technology advantage means advantage, period. The business needs to be in charge, and as Deloitte illustrates in a separate report, strategy -- not technology -- needs to guide digital transformation. Nearly half (48 percent) of the executives responding to the current survey indicate that their company’s leadership views technology as a “critical” differentiator and key to growth, up from 41 percent who said the same last year.

The sought-after "alignment" between business and IT is finally becoming a reality. For years, enterprises have been held back by technology that was either outdated or unable to keep up with new initiatives. The Deloitte survey results suggest that IT is elevating to a leadership role, versus activity that simply happens down in the data center somewhere.

Being a business leader requires technical chops. There's no getting around it, if one is going to lead a 21st-century organization, he or she needs to have a firm and informed appreciation of the power and potential of technology.

So, yes to CEOs, CFOs and business leadership becoming more involved in technology decisions, but with the backing and guidance of technology executives. Jeanne W. Ross and Peter Weill very aptly described the activist role CEOs need to play in increasingly digitized businesses in a Wall Street Journal article: "This doesn't mean that top executives should review every IT investment proposal and decision," they stated. "But it does mean that senior management must define how the company as a whole will do business in a digital economy. It means they must lead the IT initiatives that cut across all business lines. And it means they must resolve issues that local interests cannot resolve—like what data and processes will be standardized companywide."